POLITICS: Democrats agree in part with California governor’s proposal of care for all.

By Laura Kurtzman

The Associated Press

SACRAMENTO – After months of refusing to budge on health-

care reform, Democratic leaders on Monday agreed to key elements of Gov. Arnold Schwarzenegger’s plan, including a new mandate that all Californians have insurance.

The move signals that Democrats may be willing to cross their allies in organized labor, who have steadfastly opposed the idea of mandatory insurance.

But Democrats accepted the insurance mandate with the caveat that there would be an exemption for those who do not qualify for subsidies and cannot afford the minimum level of coverage required by law.

Democrats also lowered the minimum amount employers must spend from their previous health reform bill, which Schwarzenegger vetoed.

The new plan has a sliding scale for employers, with a maximum contribution of 6.5 percent of payroll.

Other funding comes from a $2-a-pack increase in the tobacco tax and from a hospital tax similar to what the governor has proposed. The total cost is about